Global watchdog to report in October on how social media fuels bank runs

Global financial regulators will present the G20 in October their findings from a “deep dive” on how social media can speed up bank deposit outflows and whether changes to liquidity rules are needed, the Financial Stability Board (FSB) said on Monday.

Posts on social media helped to accelerate outflows from Silicon Valley Bank in March 2023, one of several U.S. lenders that failed last year.

Depositors pulled $42 billion from SVB in just 10 hours.

FSB Secretary General John Schindler said the watchdog is looking at how have deposit dynamics changed, what role has social media played, and what role has new technology played now that customers can withdraw money using a mobile phone.